The disappearance of stand-alone mobile device management companies continued as VMWare announced it had agreed to acquire Atlanta-based MDM powerhouse AirWatch for about $1.54 billion. AirWatch CEO John Marshall and his team will continue to head up the unit, which will become part of VMware's end-user computing group. While accurate market shares in the MDM segment are hard to come by, AirWatch is clearly one of the biggest players, with more than 1,600 employees and 10,000 customers globally.
The scope for mobile device management has expanded to include mobile applications management and mobile data management, and the "MDM" moniker is giving way to "Enterprise Mobility Management" ("EMM"). With the wholesale abandonment of the BlackBerry platform and the need to secure corporate data on user-owned or "BYOD" mobile devices, MDM/EMM sales are booming. Gartner estimates that total software revenue for packaged MDM solutions was $1.6B in 2012, and by our estimates the market likely grew on the order of 25% to 40% in 2013. The InformationWeek 2013 Mobile Security Survey of business technology professionals found that 39% of organizations had implemented MDM solutions, up from 30% in 2012; another 33% had them in their plans.
The growing importance of mobility and the need for enterprises to maintain their security profile has driven this growth, and that activity has not gone unnoticed. In 2010, SAP acquired Sybase and its Afaria MDM product for $5.8 billion. Then in March 2012, security specialist Symantec acquired two mobile software firms: Odyssey Software, which made an MDM solution that ran on top of Microsoft System Center Configuration Manager (SCCM), and Nukona, a company that specialized in securing mobile data and applications. In January 2013, VMWare rival, Citrix, acquired privately held Zenprise, and finally in November, IBM announced it was acquiring cloud-based MDM supplier Fiberlink; the value of those transactions was not disclosed.
With AirWatch off the table, the only companies represented in the Leaders Quadrant in Gartner's 2013 Magic Quadrant for Mobile Device Management Software that are still independent are MobileIron and Good Technologies; my bet is that neither will still be independent by the end of the year.
In truth, the MDM segment was too small and specialized to have remained an independent market. With growth in other segments of the software market slowing, the big players are on the prowl for fast-growing niches they can buy into. With the overall interest in mobility and MDM sales rocketing, the MDM players were a sure target. In the analyst firm's Reference Technology Roadmap for 2013, 451 Group Research Director for Networking and Information Security Daniel Kennedy wrote, "Mobile device management (MDM) had the strongest spending intentions in 2013; 41% of respondents said their enterprises increased spending as a management response to employees' 'bringing your own devices' (BYOD) to work. Spending on MDM is expected to improve in 2014, with 46% of respondents planning to increase spending."
So now the interest shifts from the vanishing MDM market to acquisition plans. Probably the two most interesting players will be VMWare and Citrix. Both have virtual desktop integration (VDI) solutions that can now be accessed with mobile clients; given the screen size requirements, those implementations are best suited for tablets. The appeal of VDI in a mobile environment is that you have a secure connection to the application regardless of the underlying mobile network (even public Wi-Fi networks), and since no corporate data is stored on the device, if the tablet goes missing, no corporate data is exposed. However, not all VDI apps worked well on tablets; but now with an MDM play, VMWare and Citrix will have a solution for those customers who do have to store data on their mobile devices.
There seems to be an assumption in the market that if you're going to be taken as a "serious player" in the mobility space, you need an MDM offering in your kit. IBM, who previously had been touting its Endpoint Manager for Mobile Devices, got into the game seriously with its Fiberlink acquisition. Symantec appears to be bolstering its position in the security market with Odyssey and Nukona. Two names we might expect to see buying into the MDM action are HP and Microsoft, though the latter may be slow to pull the trigger given the imminent change at the top.
At the macro level, however, enterprise mobility is still hampered by the mobile industry's unwavering fixation on the consumer market. MDM/EMM solutions provide some needed management and security capabilities to mobile devices, but in the end we're still trying to do "business" with tools designed for consumers. However, as organizations increasingly shift from company-provided to user-owned devices, those devices are by definition "consumer."
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